CEOs of large financial firms need to keep their eyes on rules now being proposed in case of a firm’s demise. The FDIC says it plans to prohibit additional payments to shareholders and long-term debtholders of troubled firms. The FDIC could make additional payments to certain short-term creditors in situations where it maintains “essential operations” or to “minimize losses and maximize recoveries.”

The proposal is the first step in the government’s effort to clarify how it will seize and dismantle large financial firms that run into trouble. The FDIC was given authority to liquidate firms as part of the effort to prevent another collapse like that of Lehman Brothers.

International regulators are grappling with the same issue of “too big to fail,” seeking ways to prevent taxpayer bailouts across the globe and improve cross-border coordination in the event of a failure. The Financial Stability Board, a group of regulators, central bankers and finance ministers, expects to present proposals at the meeting of the Group of 20 industrial and developing nations in Korea next month. The proposals may include stricter capital standards for firms and requirements that they submit “living wills,” or plans for how they could be dismantled without harming the broader financial sector. For details from The Wall Street Journal, please click here.

Blockbuster Reportedly Begins Search for New CEO

Blockbuster Inc., the movie-rental chain currently under bankruptcy protection, has launched a search for a new CEO that could see Chief Executive Jim Keyes replaced before year-end, according to a media report. Keyes, who has led Blockbuster since 2007, remains a candidate to continue leading the company, unnamed sources said. Blockbuster’s senior bondholders, including billionaire investor Carl Icahn, must approve the chain’s CEO choice by Dec. 31. Blockbuster is weighed down by more than $900 million in debt. The company plans to turn itself over to Icahn and other creditors, and try to remake itself as consumers shift how they view movies and television shows. Here’s more from The Wall Street Journal.

Boards, Not CEOs, Should Be Leading the Way on M&A Deals

There’s another attempt to chisel away at traditional CEO authority, this time when it comes to major corporate deal-making such as in mergers and acquisitions. Betsy Atkins and Arlen Shenkman try to make the case that it is a bad thing that boards of directors tend to act only in reaction after a third party or management presents an opportunity, or even a bid for a target company. The pair says boards can play a more effective role in supporting, reviewing and even negotiating deals, the argument goes. They contend the role of boards has been expanding and evolving, and in the wake of investor lawsuits and court decisions arising from failed deals, boards have been increasingly targeted for vague oversight, use of inept or conflicted advisors, or weak procedures. Here’s more from Forbes.

Why So Few Tweets from the C-Suite?

This past February, Sun Microsystems CEO Jonathan Schwartz logged on to his Twitter account and informed the world of his resignation, with a tweet of Haiku poetry. That Schwartz would choose to end his tenure using Twitter was true to form, since he was one of the few Fortune 500 leaders comfortable with and capable of using social media, says Leslie Gaines-Ross.

There are other leaders of multinational corporations who use social media but they are few and far between, especially in non-technology industries. They include: Tony Hsieh (Zappos), Indra Nooyi (PepsiCo), Bill Marriott (Marriott), Paul Levy (Beth Israel Deaconess Medical Center), and Mark Cuban (Dallas Mavericks).

The fact that the ranks of social CEOs remain so limited is frankly disconcerting. These are the communications vehicles of our time, and surely it’s no less vital now than in the past for companies’ stakeholders to hear about CEOs’ plans and actions. Here’s why from the Harvard Business Review blog.

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